More than 2 billion US dollars of large orders are pouring in! Russia-Ukraine conflict, recession fears raid the market, after gold rages above 1900, is it expected to rise by another $20?
24K99 News Thursday (February 17),gold priceSoaring to an eight-month high, investors turned to the safe-haven metal amid concerns about economic growth and heightened tensions between Russia and Ukraine. Analysts believe that gold prices will rise further, with key resistance at $1903-$1923.
“There are so many different angles to look at gold right now — macro, geopolitical and inflation hedge. Bitcoin and equities are being sold off and people are looking for a place to put their money. Gold plays a lot of different roles now,” Blue Line futures chief market strategist Phillip Streible said.
A slew of data on Thursday gave investors pause as positive momentum in the U.S. job market slowed, with weaker-than-expected manufacturing data in the Philadelphia area and mixed U.S. housing data.
“Economic data is decelerating. (Officials) are trying to call it a great economy. But the reality is that the U.S. economy is slowing at a time when the Fed is extremely hawkish. That’s the biggest problem.” The economy will continue to slow down into the second quarter, and Fed tightening will really hurt growth.”
He also said that gold is a hedge against declining economic growth. “The yield curve is meant to be flat, but if you look closely, it’s inverting. That tends to lead to a recession or depression.”
In addition to fears of a new recession, a geopolitical angle has kept gold demand high. Investors’ uncertainty over the situation in Ukraine also added to the market’s risk aversion.
“The move is driven in part by geopolitical news. Right now, gold may have gained $25 due to geopolitical risk. If tensions eased, you would see gold prices fall,” Streible said.
Gold surged to its highest level since mid-June on Thursday, rising nearly $30 on the day to the $1,900 level. As of this writing, April gold futures on the New York Mercantile Exchange were at $1,901.40, up 1.60% on the day.
The data shows that the most active gold futures contract on COMEX was 2,778 lots traded in one minute at 16:26 on February 17, Beijing time, with a total value of US$523 million.
The most active gold futures contract on COMEX was at 22:01 on February 17th, Beijing time, with 2,099 lots traded in one minute, with a total value of USD 397 million;
The most active gold futures contract on COMEX At 00:46 on February 18th, Beijing time, 3,332 lots were traded in one minute, with a total value of US$632 million;
The most active gold futures contract on COMEX was at 02:29 on February 18th, Beijing time, and 2,649 lots were traded in one minute, with a total value of USD 503 million.
Ukrainian front lines are reportedly shelled, and the U.S. says war in Ukraine appears imminent. “The evidence now shows that Russia is heading for an imminent invasion. This is a critical time,” said Thomas Greenfield, the U.S. ambassador to the United Nations.
US President Joe Biden has confirmed that there are various indications that Russia is planning an invasion of Ukraine. He said Moscow was conducting false flag operations to justify military operations. “We have reason to believe that they are conducting false flag operations to gain an excuse to enter. Every indication we have is that they are ready to enter Ukraine and attack Ukraine,” Biden said on Thursday.
Russia has consistently denied plans to attack Ukraine and said earlier this week it would withdraw some troops from the border. However, Washington noted that there is no evidence that Russia has withdrawn its troops.
Gold is expected to rebound by another $20
Gold could rally to $1,923 before encountering some significant indirect resistance, analysts said. That’s why this will be a key level to watch as the precious metal continues to move higher.
“The levels we need to focus on are $1,903 and $1,923, the former being the highest weekly close since last year,” said DailyFX strategist Michael Boutros. “Gold needs a technical breakout above $1,923. If that breaks, a significant threshold will open up to the upside.”
Boutros noted that gold’s fundamentals look pretty solid right now. “Inflation is heating up, which is good for gold. Rate expectations are soaring. Worsening geopolitical events are adding fuel to the fire. The situation in Ukraine is turning violently predictable. That’s panicking the market. Gold is feeling a technical breakout.”
Gold prices are expected to test $1,900 if the situation in Ukraine escalates, said Craig Erlam, senior market analyst at OANDA. “This recent move has brought gold to its highest level since mid-June, and the move seems to still have momentum. So we could test $1,900. This is the next big test for gold, and the sharp change in Ukraine The upgrade could be the catalyst for this move,” he wrote. (24K99)
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